No. 33 - Special Editorial, July 2009

She'll Be Right, Mate
But it'll be hard yards getting there.
 
Having worked with Australian wines in the US market for over two decades, I am frequently asked for comments and observations about the ever-evolving “current state” of the Australian wine industry. Journalism being what it is, the entirety of my thoughts and opinions is often edited down to only a few choice phrases. I hope to rectify that here. Your comments are most welcome and appreciated. Please send to info@jugshop.com . –C.H.

Unless you’ve been under a rock (or possibly trapped in a fermenter), you’ll have noticed that the Australian wine industry has taken a pretty serious media bashing of late. Articles by Jancis Robinson (Financial Times), Mike Steinberger (Slate.com) and Jay Miller (Robert Parker's The Wine Advocate) have bemoaned Australia’s status among her global wine competitors based upon declining sales volume as well as waning prestige at the upper-end of the wine market. And now comes Meraiah Foley’s recent article in the New York Times.

While playing another round of “Let’s Slag Australia!” is certainly not a new journalistic endeavor, editors must find that it still makes for good copy. It definitely ignites the bulletin boards, forums and the blogosphere with the enflamed opinions of supporters and detractors of Aussie wine. The sad bit is that while there exists some “truthiness” to the detractors’ arguments, very little has been said to reflect an alternative perspective on the subject.

The focus of much of the recent criticism has revolved around the success of [yellow tail] (properly spelt, thank you!) and the menagerie of critter brands exported to the US from down under which seemed to multiply in number almost overnight. What is interesting is that American journos (at least those old enough to know better) seem not to have noticed that “cheap and cheerful” wines from Australia have been exported for years—certainly long before [yellow tail] was in the moneyed daydreams of the Casella family. While the first Aussie wines arrived on our shores in the late 60s and early 70s, the “modern age” of Australian wine exports began in the mid-80s with the advent of Lindemans Bin 65 Chardonnay, as well as critter brands of the time such as Roos Leap. The American thirst for value oriented wines which the Aussies filled during that era has long cemented the foundation of the wine trade between our two nations. Though it may have seemed so to those who weren’t paying attention, the value-oriented wines and critter brands of Australia are not something that just happened out of nowhere.

While the success of critter brands is being blamed for the blemishes on Australia’s reputation as a “serious” wine producing country, no one is talking about the real reasons for the demise of the upper end of the Australian wine market, which I attribute to “a perfect storm of laziness”. When Aussie wines became the media darling of publications such as The Wine Spectator and The Wine Advocate, the predominantly South Australian shiraz which filled the marketplace was quite literally selling itself by the numbers- a score of 90+ became the currency of the day. Importers of wines from the Barossa and McLaren Vale became overnight success stories and there was really no incentive for them (or anyone else apparently) to explore other Australian varieties or regions. All that was needed was a great score and some minimal marketing and the wines were flying through every channel of distribution.

Feeling that they had hit the proverbial gold mine, many of those wineries later began to raise prices and/or production levels while at the same time, some of the most lauded winemakers represented by these suddenly famous importers stopped visiting our shores to tell the story and sell their wares. Importers and distributors handed out allocation offerings of brand new wines with Parker and Spectator ratings, but never popped corks. Retailers bought wines sight unseen (or should that be taste untasted?) and sold them to their customers based on scores. And consumers purchased them on faith without ever analyzing whether the style was one they appreciated. It was high times, and the Australian wine industry, now selling South Australian wines in record numbers across all price points, had no need to show off the diversity of its wine business.

Well, the chicken has certainly come home to roost. There are definitely problems that must be addressed by all if things are ever going to get better and, blessedly, there are signs of progress in that regard. But in the rush to analysis, what many of Australia’s critics fail to realize is that the problems of the industry are not so simple as they would have you believe. The fatal laziness I defined earlier is also reflected in America’s poor understanding of Australia as a winegrowing nation. It was only five years ago that Robert Parker’s guide to Australian wine regions declared riesling and gewurztraminer as important grapes of the Yarra Valley, Heathcote wineries like Jasper Hill and Wild Duck Creek were listed as part of Bendigo, and while writing about regions like the Swan Valley, he overlooked Tasmania and the Mornington Peninsula. There is an Australia out there which most do not know. If they did, many criticisms would evaporate.

For example, one often hears from educated members of the trade that Australia produces nothing but factory-made wine from enormous wineries run by faceless corporations. Therefore all of Australia’s wines must be homogenous crap. Yes, the top 25 wineries produce 90% of the country’s wine. But that leaves some 1,950 wineries, most of them quite small and family owned, to make up the rest of a vibrant and diverse industry. All of this coming from 65 growing regions spanning a country the size of America.

And what of the overlooked viticultural treasures to be found down under? Much hoo-hah is made over pinot noir produced from stolen DRC budwood, as if this somehow demonstrates a relationship to royalty and, by association, to quality. Yet almost none of the “Rhone Ranger” winemakers from California that I’ve talked to over the past decade has been aware that most of the pre-phylloxera clones of syrah, grenache and mourvedre are now found only in Australia, many planted on their own roots and some in vineyards nearly 160 years old. One might think winemakers would be twittering like crazy and flying to Australia by the planeload to obtain cuttings from these treasured old elders! These are but two momentous facts about the Australian wine industry that somehow remain largely unknown, despite having a significant presence in the American market for over 20 years.

The arguments made about the current status of Australian wines in America are also narrowly focused and fail to see the larger picture. For one, many of the wines that are not selling anymore, the wines that have incurred outright condemnation by many in the trade, are the so-called ooze monsters that were once the darlings of the wine critics. Those same critics often focused entirely on certain styles from certain areas and failed to tell their readers about shiraz styles from other regions as alternatives. Australia’s entire wine industry was literally defined by a handful of regions, as if nothing else existed there. As an analogy, this would be like dismissing the entirety of the California wine industry based on the fact that the Santa Rita Hills produces high alcohol pinots.

Please don’t misunderstand—Barossa and McLaren Vale should make wines reflective of their terroir as understood by the growers and vignerons who make them. Perhaps the wines aren’t to everyone’s taste, but then no wine variety or style is to everyone’s taste. I personally don’t “get” gruner veltliner and my partner would probably rather be shot than drink pinot gris. But neither of us would presume to tell a winemaker how to make their wines or that their wines shouldn’t be made just because we aren’t its biggest fan. I tend to defer to their expertise, especially after a 175 year winemaking history.

Secondly, the folks that are screaming the loudest (retailers, distributors, etc.) about the current malaise are those who put all their eggs in the South Aussie shiraz basket. What they did (like many who have lost their butts in the stock market) is they failed to diversify. At The Jug Shop, Australian wine sales overall are down less than 5%, but more for wines above $40. But we also sell the range of Australia. If you don’t like ooze monsters, well then, we’ve got some more elegant styles from Victoria. How about some Grenache? Not much oak there. Like rosé? We got ‘em. Ceviche for dinner? Have I got a riesling for you! How about stickies? Ever try sparkling shiraz? Those retailers that sell the full range of Australian wines are doing fine. It stands to reason that it’s those who didn’t diversify that have suffered the biggest losses. (Curiously, they seem not to take any blame for the failure to educate themselves about Australia’s diversity.) Bad news sells and what we haven’t seen are those success stories that could shed a light on a possible way out of the current situation.

Finally, there are a few things which also need to be remembered. Australian wines, while not the hot category they once were, are not going anywhere. All regions have their 15 minutes and then it’s off to the next big thing. Today it’s malbec, yesterday it was gruner veltliner. And it’s not just high-end South Australian wine that’s suffering. Syrah sales are also off for many of California’s Rhone Rangers, especially at the top end of the market. This “sophomore slump” will end at some point.

Australia also has a large amount of goodwill banked over the years, especially among the average consumers of America. The country’s wines are seen as good values that over-deliver on price and flavor. These qualities will be especially useful in a souring economy where wines from other parts of the world look to be comparatively expensive. Additionally, many winemakers are now working overtime selling their wines in the US and they are effective and personable storytellers. The industry and its’ government agencies also realize that it’s back to Square One and time to refocus educational efforts towards an understanding of regional and viticultural diversity. Wine educators, the restaurant trade and wine distributors will be the focal point of this new project. We can also expect new marketing and educational programs from the states of Australia and even individual growing regions as they try to focus their messages to the American market, much as the wine producing counties and AVAs of California currently operate. In short, Australia ain’t goin’ down without a fight.

But what actually may be the root cause of Australia’s current condition is that it really suffers from a case of tall poppy syndrome. Overly concerned that their great wines don’t measure up to those of the Old World, there is a bit of an inferiority complex about the industry. For some, the wines of Europe set the standard by which all Aussie wines are measured. Even locally, the great pinots of Australia are often viewed in a less than favorable light compared to their counterparts from New Zealand (which cannot be said when it comes to rugby or cricket). Today, you’d be super hard-pressed to find a Napa Cabernet producer present his or her wine as if it had to measure up to Bordeaux! And a recent report that Italian wine exports fell off by over 20% in the US during the first quarter of 2009 has not spawned a similar editorial furor nor the attendant deluge of self-criticism within the Italian wine industry.

The wines of Australia are, in fact, world class wines that show terroir, a sense of place, and reflect an intimate history of people and the land where many have toiled to create their wines. The swagger and confidence that is seen in Australian sport needs to rub off on those who make and sell Australian wine, along with an understanding that this country can easily be seen as one the globe’s top wine producing nations. When that happens, and it will surely happen given Australia’s drive and commitment to succeed, all this malaise we see today will surely be something of the past.





Down Under Discoveries by Chuck Hayward, © July 2009
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